The Texas Association of School Boards has offered to assist school districts that participated in a now-defunct health-insurance trust that left $8.5 million in unpaid claims by 7,000 school personnel.
The Texas School Services Foundation, the association’s administrative-services branch, would help the school districts obtain loans and help broker settlements for a 3 percent fee, according to association officials.
“We’re trying to figure out ways to make this as painless as possible,” said Barbara Williams, tasb spokesman.
She said association officials were expecting the participating districts to resolve the issue within 60 to 90 days.
Some 400 people attended a Sept. 30 meeting between tasb officials and the districts that participated in the Employee Group Health Trust.
The trust was formed in 1983 by a coalition of 209 rural districts allied as the Texas Association of Community Schools.
The health-insurance trust filed for bankruptcy Sept. 2, prompting the Texas State Teachers Association to file a lawsuit demanding that the participating school districts pay their employees’ outstanding medical claims. (See Education Week, Oct. 5, 1988.)
In a prepared statement, Joe Seale, executive director of the Texas Association of Community Schools, said participating districts were urged to pay the outstanding claims and were told that they were responsible under state law for the medical debts.
According to the statement, the Texas School Services Foundation offered to both help them borrow any money needed to pay the claims and handle the mechanics of paying the outstanding claims.
Mr. Seale’s news release, which stated that the trust enrolled about 200 districts as members, explained that it became insolvent because of increasing medical costs.
But the union’s lawyers have claimed that a membership decline to about 80 districts caused the trust’s revenue problems.
Officials of both the union and the school boards’ association said that unless the districts pay the outstanding bills, teachers could be held liable.--nm
